Funders, Experts Raise New Questions About Uganda’s Contentious Karuma Dam

KAMPALA, Uganda

Uganda’s controversial $2.2 billion USD Karuma Dam project faces more delays, with more questions being raised over the role of the country’s development partners in the project and the viability of its technical design.

The project, which has been in the works for 16 years, was supposed to start this month, but some of its would-be financiers as well as experts in dam construction claimed this month that President Yoweri Museveni’s government has ignored their input in the 660-megawatt hydropower project.

The Karuma Dam will be located on the White Nile.

Last week, local media quoted some experts, who declined to be named, as warning against moving forward with construction of the dam using the design proposed by India’s Energy Infratech Pvt Limited.

One expert in Kampala said the dam’s infrastructure and design are not sustainable for a 660-megawatt facility with a planned water storage capacity of 78.78 million cubic meters.

He was also critical of the choice of the project site, which he says has rapids and hence will cost more to develop. In addition, he alleged that Energy Infratech had exaggeratd estimates of the volume of water flow at the Kyoga Nile spot.

Earlier, a report by global non-profit International Rivers charged that Uganda has locked development partners and financiers out of the Karuma project and rejected advisory services from them.

"Various development partners have made offers to support implementation of the Karuma project, for instance, through technical advisers or financing for an international panel of experts for dam safety. Thus far, these offers have not been taken up," said Dr. Jan Martin Witte, senior project manager at German development bank KfW Entwicklungs.

The International Rivers report, released four months ago, says KfW had offered to get an international firm to evaluate the tender process, but the government of Uganda refused. So far, four Chinese firms are among the nine companies said to be prequalified for the contract.

However, Bukenya Matovu, a spokesperson in the Ministry of Energy and Mineral Development, insists Uganda has not given preference to any of the prequalified bidders.

"We are not even sure that the Chinese will win the bid, but if they do I am sure they will do their best to demonstrate their competencies. There is a cut-throat competition between the East and West with campaigns to capture resources," he said.

Uganda faced controversy in the past over tendering and construction of another hydropower project at Bujagali. The government was accused of overstating the capacity of the 250-megawatt project, which added its first 50 megawatts to the national power grid a few weeks ago.

Energy Minister Irene Muloni said back in March that the claims were false. “…The amount of power it can generate depends on the amount of water available at the dam. What this means is that the dam can generate varying amount of power depending on the desired need and the amount of water available.”

"Having learnt a lesson from Bujagali, we are not prepared to go through that again," said Matovu.

However, KfW now says the government is not ready to listen to “anything that in their view will delay the project.”

“We have not been asked for any support. Everybody at the ministry is keeping the information close to their chest, and I understand this is due to the Bujagali experience. Nevertheless, we would like to be engaged in the procurement process for the EPC contractors," said Witte.

Controversy over construction of the Karuma Dam first emerged in 2009 when Norpak Power Ltd, a Norwegian energy firm, pulled out of the project. Although the company said it had done so because of the debilitating global economic crisis of 2008-2009, the pullout was preceded by a disagreement with the World Bank over funding of the project.

Norpak said the World Bank had issued new guidelines for companies participating in construction on the dam, and the Norwegian firm objected.

After Norpak pulled out, Uganda moved to re-design the 250-megawatt power project and expand it to 750 megawatts. This was revised downward to 660 megawatts due to concerns from the country’s development partners and Nile River riparian states.

Ugandan Finance Minister Maria Kiwanuka allocated $334 million USD for the Karuma project in 2011-2012. 

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